Delay sought in UBS case

The U.S. and Swiss governments and banking giant UBS AG indicated Sunday they were seeking a settlement and asked a federal judge to delay high-stakes hearings on the Internal Revenue Service’s effort to identify thousands of suspected American tax evaders.

The one-page motion, filed in Miami less than 24 hours before the hearings were to begin today, said postponement is needed “to allow the two governments to continue their discussions seeking a resolution of this matter.”

Unless a deal is reached beforehand, the filing asks that the hearing be rescheduled for Aug. 3.

U.S. District Judge Alan S. Gold did not immediately rule on the request, but judges routinely allow parties in civil cases extra time to settle out of court.

In a statement, the U.S. Justice Department said any agreement would have to require that UBS provide “information on a significant number of individuals with UBS accounts.”

“If an alternative resolution is not reached, the Department of Justice will continue to vigorously pursue enforcement of the summons through the court,” the statement said.

The case seeking the identities of some 52,000 wealthy American clients suspected of hiding $15 billion at UBS has already sent shock waves through the international banking system.

Bankers fear a ruling against UBS would disrupt cross-border commerce, force people to withdraw huge sums of money from financial entities with offshore offices and play havoc with international tax treaties. Experts say some other foreign banks are asking American clients to close out accounts for fear they may be targeted next.